With Streaming Video, Ad Strategies Come Streaming In

Streaming video is a market that, though still in its infancy, appears poised to grow up fast. According to the January 2012 Accenture report “Always On, Always Connected” that analyzes online services used by worldwide Internet users, 36 percent of consumers aged 18 to 34 stream movies and shows, along with just 20 percent of those aged 35 and up. And yet, digital streaming services seem to be raking in the dough. In the past year, Hulu grew by 60 percent to reach $420 million in revenue. And even though it lost hundreds of thousands of customers due to an increase in prices, Netflix still boasts 20 million weekly streaming customers who watch an average of over 33 hours of content per month.

The recent news that Verizon and video rental service Redbox will partner this year to create a new digital streaming service is, therefore, worth paying attention to. Verizon and Coinstar, Inc., parent company of Redbox, are reporting that their new service will include DVD and Blu-ray rentals along with on-demand streaming media services. Just as Netflix and Hulu users are able to stream movies and TV shows to TVs, computers, and mobile devices, so too will consumers who subscribe to the new Verizon-Redbox service.

This has some significant implications for advertisers. It’s still unclear to what degree the new service will be ad-supported. Netflix has shied away from advertising to date, but streaming media giant Hulu offers :15 and :30 video spots, companion banners, overlays, and plenty more. If Verizon and Redbox want to introduce advertising into the streaming portion of their service, they’ll merely need to take a look at Hulu’s victories and mistakes.

Funnily enough, it turns out that its successes are, in fact, attainable to any advertiser. The best practices that have evolved from streaming media advertising are essential to virtually all marketers reliant on video content to promote their services and products.

Providing Options

Hulu was one of the pioneers of the Ad Swap ad selector unit that allows its users to choose from several advertising options. The concept is quite revolutionary: instead of requiring users to watch whatever the content publisher (and its advertising clients) believes should be of interest, they allow them to actively express where their interests lie.

If given the opportunity, advertisers should consider providing similar flexibility to their target customers. According to Break Media’s 2012 Digital Video Advertising Trends Report, ad selector units are among those expected to see big gains this year: while 18 percent of marketers used the unit in 2011, 33 percent plan to in 2012. Check with your media partners to see if they’re offered (among those sites making them available are NBC and CBS).

Making Your Voice Heard

Whether it’s achieved by way of a page skin or by purchasing all banner ads associated with specific content, having complete share of voice on a site page can provide exposure that’s unrivaled. When that page is drawing users who are primarily interested in watching video clips, it’s even more essential. Regardless of how entertained consumers stand to be by your video ads, there will probably always be a part of them that resents the interruption. Leave them to their videos by concentrating on the surrounding space and they’ll forgive you your banner ads. They may even be more willing to give them due consideration.

Getting on the Right Track

We all know the importance of targeting ads, but when it comes to advertising around streaming media, few tactics play a greater role. “The success of streaming video websites…will depend not only on their ability to offer valuable premium paid subscriptions, but also their ability to provide compelling free content by enticing advertisers that can monetize it,” says Martin Hayward, director of marketing for Mirror Image Internet. Hayward points to cookies and pixel-tracking as key elements, and this kind of user data is critical to brands across the board. As for the future of streaming media, “The website that can offer advertisers the most value by getting their ads in front of the right audience will be the big winner here.”

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